“Complexity is ”the state of being difficult to understand and apply” (SEC 2008, cited in Petersen, 2012). Complex accounting specifically pertains to the difficulty in understanding the mapping of transactions (or potential transactions) and standards into financial statements” (Petersen, 2012, p. 73).
Your reports should be directed to the Chair of the Australian Securities Exchange (ASX) addressing evidence that exists in relation to complexity in financial reporting.
The assessment requires you to explain in a report for the Chair of the Australian Securities Exchange (ASX) the research evidence that exists in relation to complexity in financial reporting and its impacts, together with explanation of what the International Accounting Standards Board is doing to address this issue through its ‘Disclosure Initiative.
A report format is required for this assignment. In a report, the Executive Summary should provide an overview of the whole report, including any recommendations. Further, an assignment, which presents more quotes than constructive analysis and argument may be heavily penalized.
Suggested report structure:
1. Title page
2. Contents page
3. Executive summary (provides an overview of the whole report)
4. Introduction and purpose
5. Responses to specific task using appropriate headings and sub-headings
Petersen, K 2012, ‘Accounting complexity, misreporting, and the consequences of misreporting’, Review of Accounting Studies, vol. 17, no. 1, pp. 72-95.
Securities and Exchange Commission (SEC) 2008, Final Report of the advisory committee on improvements to financial reporting to the United States securities and exchange commissions, viewed 3 September 2015, https://www.sec.gov/about/offices/oca/acifr/acifr-finalreport.pdf
Auditing and Assurance Services in Australia
Grant E. Gay, Roger Simnett. ISBN 9781743079980